The Real Deal New York

Rental projects were long considered bulletproof, a safe backup for
more profitable and risky condos. But with the precipitous drop in New
York City rents — perhaps on the order of 30 percent from the top of
the market once incentives are factored in — it’s clear that they are
no longer a surefire bet.
“Nobody who’s got anything under construction is kidding anybody by
not admitting that rents are less than where they were when we all
underwrote these transactions,” said Veronica Hackett, cofounder and
managing partner of the Clarett Group, a developer of condos and
rentals that began leasing at the 490-unit Brooklyner at 111 Lawrence
Street in Downtown Brooklyn a month ago. [more]

Following the global financial crisis at the close of 2008, most in the
New York real estate community were expecting the coming year to be
more challenging than any in recent memory. And 2009 did not
disappoint. As the year comes to a close, The Real Deal looks back at the headlines that defined 2009 — virtually all of which involved bad news for the city’s real estate industry.
Most striking, perhaps, is the extent to which 2009 saw titans of
the field toppled: The record prices paid in the boom years for
properties like Stuyvesant Town, the Apthorp and trophy office towers
such as Worldwide Plaza came to seem like bad bets. Meanwhile, many
smaller players were squeezed out of the game as the market contracted.
[more]

Serena Boardman (Photo credit: Patrick McMullan)

It’s 2005, and golden-haired socialite Serena Boardman is sunning
herself on a yacht near the coast of Sardinia in Italy. Nearby, her
friend Dori Cooperman — now best known for befriending actress Lindsay
Lohan in rehab — is on the phone with a reporter from W Magazine,
chronicling the addictive qualities of photo Web site
PatrickMcMullan.com.
Boardman interjects with her opinion of the site, which documents
the social lives of New York City’s glitterati. “Tell him it captures a
moment,” she shouts.
Until recently, the scene was typical for the 39-year-old Boardman,
the jet-setting heiress to a banking fortune whose stepmother is a
European princess.  More

[more]

A. Laurence Kaiser IV, the president of Key-Ventures Realty

Fascination with Manhattan high society has reached a fever pitch
lately. The TV show “Gossip Girl” glamorizes the lives of pampered
Upper East Side teenagers, complete with references to catered co-op
board meetings and the Colony Club, while real-life New York socialites
Amanda Hearst and Olivia Palermo are now feted as celebrities. A similar phenomenon appears to be occurring in the world of
Manhattan real estate. Suddenly, the priciest and most
attention-grabbling listings in town are in the hands of well-heeled
brokers like Southern belle Leighton Candler, Stribling’s Kirk Henckels
and the Clintons’ broker Kathy Sloane, names heard less frequently
during the boom years, as brash brokers like Dolly Lenz and Michael
Shvo dominated the headlines. But it’s not just pop culture that’s bringing about this shift.
[more]

Nancy Packes, president of her own new development marketing firm, at 316 11th Avenue, where she is the leasing consultant. The building is slated to begin renting units this winter.

Once the province of a few niche players, the new development rental
sector is becoming a hotly contested battleground as brokerages look to
replace once-lucrative condo deals.
In the booming economy of the mid-2000s, many new development
marketing firms focused most of their attention on sales, while a few
firms had the rental field to themselves. But now, as marketers migrate over from the stagnant condo market,
newly built rentals are emerging as an increasingly important source of
revenue. And the sector is only expected to grow more competitive in
2010. “During the condo boom, they only focused on condos — that’s where
the money was,” Citi Habitats President Gary Malin said of new
development marketing firms. “Their condo stuff has slowed down, so
they’re trying to get in [to the rental market]. They’re looking to
find other revenue streams,” he added. While the pipeline of condos coming to market is slowing, brokers anticipate a healthy number of new rental buildings in 2010, largely because they have proved easier for developers to finance in the current climate. Some 2,935 rental units have come online in Manhattan so far this year, compared to 1,482 in 2008, according to a market report by Nancy Packes, the president of Brown Harris Stevens Project Marketing and founder of her own new development marketing firm, Nancy Packes, Inc., which does both new development sales and rentals. Roughly 2,840 units are expected in Manhattan in 2010. In Brooklyn, 1,245 new rental units have hit the market in 2009, while approximately 1,100 are expected in 2010.
[more]

While most developers are feeling the pain of the downturn, some are feeling it more than others.
This month, The Real Deal looked at the new condo buildings
that have seen the most buyers trying to renege on their contracts
since the real estate market took a nosedive last year. The analysis found buyers asking for their deposits back on nearly
400 units within 20 buildings. In one case, more than 50 percent of the
buyers in a building, the 505 in Hell’s Kitchen, filed lawsuits in
federal court asking for their deposit back.
The Real Deal obtained a list of escrow disputes from state
Attorney General Andrew Cuomo’s office via a Freedom of Information Law
request, searched published archives and court databases for lawsuits
against developers, and consulted with attorneys who are working on
these cases. While there is no comprehensive list of contract disputes, the result
of the research is the accompanying list of the 20 buildings citywide
that our analysis found had the most wrangling over contracts. [more]

1775 Broadway, where Kohl’s was reportedly looking to open its first Manhattan site (source: PropertyShark)

This holiday shopping season, the biggest sale in Manhattan just might be for flagship space. As 2009 draws to a close, the anemic pace of major retail leasing — the five major Manhattan retail submarkets tracked by Cushman & Wakefield scored just one deal over 10,000 square feet this year, compared to 11 across the same five submarkets in 2008 — has started picking up. Following a deal by furniture retailer Raymour & Flanagan for 30,000 square feet in August, brokers say tenants are finally looking around, after almost zero activity in the first half of the year. Bradley Mendelson, an executive director of Cushman & Wakefield, told The Real Deal he had a signed commitment last month from a tenant for 16,500 square feet of corner and second-floor space at 666 Fifth Avenue, perhaps the most prominent of a slew of major flagship vacancies across Manhattan. [more]

A pop-up eBay store at 3 West 57th Street

Diet Coke, eBay and Fortunoff are not typically brands that have a lot in common. But this year, those companies each occupied the same temporary Manhattan address, 3 West 57th Street, following Bulgari, Coach and other temporary tenants who have set up shop at this site just west of Bergdorf Goodman. The site’s landlord, the Hakim Organization, which did not return a request for comment, is said to be seeking as much as $5 million in annual rent — a sticker price seemingly too high for a long-term deal. While pop-up stores began proliferating across the city several years ago as a way for landlords to fill vacant spaces for a few weeks between long-term leases, thanks to the recession they now have a new function. Indeed, some retail spaces, such as 3 West 57th Street and 134 Spring Street, are quietly becoming home to a revolving collection of temporary stores, with no permanent tenants in sight. In addition, landlords that had not previously been open to temporary deals are inking them. [more]

View all the commercial deals printed in The Real Deal’s December issue and browse the archives here:

Office leases
Retail leases
Commercial sales

(Click below to open larger PDF)

If the last 12 months have served as a humbling recalibration of the entire U.S. economy, then there is perhaps no urban office district more representative of America’s fall from opulence than the commercial stretch along Park Avenue in Midtown. For decades, it was the province of the financial titans, including JPMorgan, Lehman Brothers and UBS, whose paychecks and egos were matched, in part, by Park Avenue’s astronomical asking rents in its premier buildings. But now, much like its former white-gloved denizens, Park Avenue is an empty shell of its former self. The Park Avenue submarket — which runs from Grand Central to 59th Street — has fallen harder and faster than any other Manhattan submarket over the past 12 months. According to Cushman & Wakefield, from October 2008 to October 2009, average asking rents dropped 34.7 percent, from $108.57 per square foot to $70.85 per square foot. By comparison, overall asking rents in Manhattan fell 22 percent during the same period. [more]

Staten Island office building for sale

A 40,000-square-foot Class A office building at 1535 Richmond Avenue in the Bulls Head section of Staten Island is for sale with an asking price of $11.3 million. The property has been triple-net leased to Staten Island Bank & Trust for its headquarters ever since the building was completed in 2002. The lease runs through September 2017 and has two five-year options. The tenant has subleased the second floor to the Staten Island Board of Realtors and a childhood development services provider through the end of its lease term. Andrew Lester of CPEX Real Estate is handling the sale.

Tribeca mixed-use property being offered

A five-story mixed-use property at 70-72 Franklin Street is on the market with an asking price of $11 million. The 20,500-square-foot building, also known as 2 Franklin Place, has eight residential units and one commercial unit. Four of the eight units on floors two through five are occupied by interim multiple dwelling tenants. The prewar property sits on a lot measuring approximately 42 by 100 feet and has an additional 5,428 square feet of available air rights. The asking price represents a capitalization rate of around 7 percent and a price per square foot of about $515. Marcus & Millichap is marketing the building.

Washington Heights rental buildings for sale

A package of four multifamily rental buildings at 633 West 171st Street and 636, 642 and 643 West 172nd Street is for sale with an asking price of $10.2 million. Named the Hospital Portfolio due to its proximity to New York-Presbyterian Hospital, the five-story walk-up buildings have a combined 113 residential units. The buildings range in size from 22,585 square feet to 26,005 square feet. Each of the properties has a floor-area ratio of 6.02, and the buildings together have 66,086 square feet of remaining air rights. Robert Shapiro, Robert Knakal and Thomas Donovan of Massey Knakal are marketing the portfolio.

LES development site on the market

Five contiguous lots forming an L-shaped parcel at 206-210 Delancey Street and 49-51 Pitt Street are on the market with an asking price of $8.75 million. The development site is poised for an as-of-right residential development, offering 75 feet of frontage along Delancey Street and 53 feet of frontage along Pitt Street. The lots are zoned R8A, providing 65,550 buildable square feet, and a 120-foot height limit has been imposed on the site. An existing one-story repair shop currently occupies the property. Alan Miller of Eastern Consolidated is handling the assignment.

Noho mixed-use property on the block

A six-story mixed-use building at 31 Bond Street is on the market with an asking price of $8.5 million. The 16,270-square-foot property is located on the south side of Bond Street between Bowery and Lafayette Street. The elevator building has a ground-floor retail space that is being used as a gallery and has 15-foot ceilings, and the five floors above are being used as recording studios and live-work spaces. The ground floor has 2,825 square feet of space, while the second through sixth floors each have approximately 2,689 square feet of space. The building could be delivered vacant. James Nelson, Brock Emmetsberger, Brendan Gotch and Billy Simons of Massey Knakal are handling the sale.

Three-building Bronx assemblage for sale

A package of three buildings at 2995, 2997 and 2999-3001 Third Avenue in the South Bronx is on the market with an asking price of $7.76 million. Located in the shopping district known as the Hub, the contiguous, block-through properties have over 100 feet of frontage along Third Avenue. The 2995 Third Avenue property has a two-story commercial building plus a four-story warehouse. The six-story building at 2997 Third Avenue has a retail unit on the ground floor with 15 residential units above. The four-story building at 2999-3001 Third Avenue has four commercial units. Nick Burns of Massey Knakal is marketing the package.

Astoria retail building on the market

An 11,847-square-foot retail strip at 87-16 Astoria Boulevard in Queens is for sale with an asking price of $6.45 million. The one-story property is located on the south side of Astoria Boulevard between 87th and 88th streets. The 215-foot-wide building is fully occupied by seven retail tenants, including a 7-Eleven, a Subway and an OTB. The retail spaces are net-leased to the existing tenants, which are responsible for all charges, repairs and damages, excluding taxes and insurance. A parking lot on the eastern end of the property accommodates 10 cars. Swain Weiner of Massey Knakal is marketing the building.

Compiled by Linden Lim

Compiled by Linden Lim

(Click below to view larger PDF)

Major lease deals signed at the Boston Properties trophy office building at 399 Park Avenue over the past month seemed to indicate the market was getting a boost. But the latest reports from the city’s commercial brokerage firms show continued slippage in Manhattan office leasing, and those mixed signals make it difficult for brokers to agree on what advice to give their clients. Erik Schmall, a senior managing director at commercial firm Studley, said at the start of the crisis, his firm counseled tenants to hold off on making deals. But that stance has softened recently, and the company believes low-priced space can be had at attractive pricing. “Whether we are at the bottom of the market or really close to it, we feel we are close enough where the quality of the deals we can get probably outweigh any possible further benefit,” he said. [more]

Click chart to see enlarged version

While Manhattan buildings have seen sale discounts as high as 70 percent in this recession, this is not the first time the city has seen bargain-basement prices for skyscrapers. Indeed, in the early 1990s, when New York was in the throes of another recession, a flurry of deals was brokered that in hindsight seem shrewdly forward-thinking. This month, The Real Deal took a walk down memory lane and looked at some of those real estate deals to see which buildings traded at significant markdowns and which investors made savvy bets. [more]

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In New York City real estate, buyers have had the upper hand for a
while. With transactions virtually frozen in the wake of last year’s
collapse of Lehman Brothers, sellers grew alarmed, dropping prices and
offering incentives to tempt purchasers. For the first time in a year, however, New York is no longer a
buyer’s market, brokers say. Or at least not the intense buyer’s market
of recent months.
“Neither buyers nor sellers have an obvious upper hand over each
other right now,” said Ric Swezey, a senior associate at the Corcoran
Group.
As the stock market recovered and prices dropped, more buyers –
especially those who put off buying during the financial crisis — came
back into the market, searching for bargain prices. [more]

As the holidays approach, speculation in the real estate industry has turned to next year. While 2010 is expected to be an improvement over 2009, experts say several potential game changers are lurking ahead, with the possibility of throwing the city back into a slump or injecting unexpected strength into the market. In a series of stories this month, The Real Deal looks ahead to the changes in store for New York’s residential brokers in 2010. A new kind of online brokerage, known as a VOW, is already changing the playing field for listings in Manhattan. Many say it’s paving the way for a true Multiple Listings Service database, something many brokerages have resisted here. Meanwhile, as market activity continues to shift from flashy new construction condos back to resales, well-connected high-society brokers are re-emerging as the ruling elite of the brokerage world, replacing powerful up-and-comers who reigned as recently as last year. Some brokers are attempting to change the paradigm by proactively working with co-op boards to increase their pool of buyers. And new development firms are hoping to inject life into their business by focusing more on new-construction rental projects. [more]

Everyone loves cash. Nothing new there. But in this market, cash deals are even sweeter. In some cases, a onetime payment could even be the only way to close a sale, according to brokers, attorneys and developers. And discounts often await all-cash buyers. There are other benefits: less paperwork and fewer delays in getting deals done. No long waits for banks to pore over buyers’ financial records, only to reject them on the eve of closing. “Cash used to be king, but now it’s the emperor,” said Luigi Rosabianca, a real estate attorney who says 50 percent of his clients have paid cash so far this year versus 20 percent in 2007 at the market’s peak. The exact number of cash deals is difficult to determine; property records on file with the city’s Department of Finance don’t specify how apartments are paid for. And the sheer number of cash deals doesn’t seem to be increasing, as the volume of all deals remains depressed. [more]

Broker Dolly Lenz is reaching out to co-op boards to gauge whether they’ll bend the rules for the right candidate. One of the buildings she’s working with is the Dakota.

This fall, Lawrence Rich decided he wanted a puppy. “I love my
building, but I’m missing a dog,” said Rich, an associate broker at
Prudential Douglas Elliman who lives at 45 Sutton Place South. As a real estate broker, he also knew that the co-op’s strict
no-dogs-allowed policy was likely hurting the building’s apartment
values in a tough economy.
So he printed out a list of reasons why the building should allow
dogs, and deposited copies on each resident’s doorstep, tying the
missives with a satin ribbon.
In what promises to be another challenging year for the real estate
industry, Rich is one of a growing number of brokers urging co-op
boards to consider broadening their pool of acceptable buyers. And it
seems that some of the boards are actually starting to bend — a
reality that could help boost co-op sales in 2010.

[more]

Leigh Zaph is planning on registering his three-person firm, Manhattan Homes, as a Virtual Office Web site.

A new breed of online brokerage is springing up in New York, altering
the landscape of real estate sales in Manhattan and worrying
traditional firms, who fear the changes may hurt their business. In the past, New York firms have contended with Web aggregators
like StreetEasy and Trulia, which gather and post information on local
brokerage listings. But thanks to a recent settlement between the federal Department of
Justice and the National Association of Realtors, the Real Estate Board
of New York is now sharing all of its members’ listings directly with
online brokerages, known as “Virtual Office Web sites.” These VOWs, as they are called, allow consumers to view those listings — including those from other firms — online. Experts say the change will have far-reaching consequences for the
industry in the coming year and beyond. Some believe VOWs could also
pave the way for a comprehensive Multiple Listing Service, which has
long been resisted here.
[more]

Manhattan

Chelsea

$720,000

133 West 22nd Street

1-bedroom, 1-bathroom, 643 sf condo in new full-service elevator building; concierge; unit has floor-to-ceiling windows with views of the Empire State Building; building has outdoor pool, fitness center, landscaped roof deck with cabanas, wet bar and grill area; maintenance $498; taxes $130; asking price $905,000; 107 weeks on the market. (Brokers: Steve Carter, Cantor Pecorella; Holly Sose, City Connections Realty)

Flatiron

$510,000

16 West 16th Street

1-bedroom, 1-bathroom, 600 sf co-op in a prewar elevator building; 24-hour doorman; unit is renovated with eat-in kitchen and hardwood floors; building has courtyard, garage, laundry; maintenance $665; 51 percent tax-deductible; asking price $529,000; seven weeks on the market. (Brokers: Dennis Margulies, Jane Wheatley, the Corcoran Group; Kathryn Swift, Barak Realty)

“The buyers [were] looking for a pied-à-terre. Their current pied-à-terre was on the fifth floor of a walk-up building. … They wanted something that was comfortable and easy, that they felt safe in, and that they didn’t have to walk up a gazillion stairs to get to.”

–Kathryn Swift, Barak Realty

Lincoln Square

$1.74 million

243 West 60th Street

2-bedroom, 2.5-bathroom, 1,666 sf condo in a full-service luxury building (the Adagio); doorman, concierge; unit has 11-foot ceilings, northern exposure with city and sky views, custom-designed kitchen, rainforest showers and heated limestone floors in bathrooms; building has health club, indoor pool, tennis court, lounge; common charges $1,648; taxes $183; asking price $1.795 million; 96 weeks on the market. (Brokers: Kim Shepard-Fabrizi, Natalia Chin, Rachel Altschuler, Brian Nordell, Prudential Douglas Elliman; Ben Garama, the Corcoran Group)

“This was a foreign buyer from Germany who is going to be using the apartment as a pied-à-terre and it was a cash deal. … It was a fairly smooth-sailing deal considering this market, whereas in a lot of my other deals, nothing is going right.”

–Kim Shepard-Fabrizi, Prudential Douglas Elliman

Upper East Side

$602,000

222 East 80th Street

2-bedroom, 2-bathroom, 1,100 sf co-op in full-service building (Kimberly House); 24-hour doorman; unit has renovated kitchen and high ceilings; building has roof deck, garage, laundry room, bike room; maintenance $1,711; 45 percent tax-deductible; asking price $649,000; 65 weeks on the market. (Brokers: Anthony Miller, Bellmarc Realty; Doreen Courtright, Prudential Douglas Elliman)

Brooklyn

Dumbo

$845,000

30 Main Street

1-bedroom, 1-bathroom, 1,270 sf loft apartment in full-service luxury condo; 24-hour concierge; unit has hardwood floors, whirlpool tub and washer/dryer; building has roof deck, fitness room; maintenance $578; taxes $32; asking price $899,000; 42 weeks on the market. (Brokers: Matt Holbein, Katherine Camp, Prudential Douglas Elliman; Brian Huang, City Connections Realty)

“The attorney for the buyer said that out of millions of real estate deals he’s done, this one lasted the longest. The problem was with financing. … During boom times this was a very normal deal but with all the Fannie Mae and Freddie Mac changes … the [bank] kept stringing us along.”

–Brian Huang, City Connections Realty

Fort Greene

$339,000

209 Clinton Avenue

1-bedroom, 1-bathroom, 860 sf junior-four co-op in a prewar elevator building (the Clinton Hill Cooperatives); doorman; unit has north and west exposures and hardwood floors, dining alcove can be converted to a second bedroom; building has courtyard, laundry; maintenance $784; 35 percent tax-deductible; asking price $345,000; 12 weeks on the market. (Brokers: Laura Milkowski, Christina Prostano, the Corcoran Group; Randolph Green, Century 21 NY Metro)

Sam Heskel, founder of HMS Associates

While green shoots may have sprouted in some sectors of the New York City residential market, there are plenty of other areas where that is far from the case. Foreclosures continue to ravage neighborhoods throughout the outer boroughs
– most notably southern Queens and parts of Brooklyn — and more distress is quietly creeping into the Manhattan residential market.

In this month’s Q & A, appraisers, analysts and brokers who follow foreclosures told The Real Deal that while certain areas of the city are starting to level off when it comes to foreclosures, in others it’s difficult to even find a “regular” nondistressed sale.

One expert from New York University’s Furman Center said that the third quarter of 2009 saw 6,000 foreclosure filings in the city — the largest number since the research center started tracking quarterly data in the early 1990s.

And worrisome trends are on the horizon. For one, pre-foreclosure, or lis pendens, filings are up in Manhattan, even if the borough is still relatively insulated compared to the outer boroughs. In addition, the kind of homeowners throughout the city who are falling into foreclosure is shifting from just those who got into unaffordable mortgage situations to those who are losing their jobs. Finally, because New York State has the longest foreclosure cycle in the country, the numbers may be understating the severity of the problem here.

For more on how foreclosures are impacting property values, where new ones are popping up and how brokers are getting in on foreclosure sales, we turn to our panel of experts.

Sam Heskel

founder, HMS Associates

What’s happening with residential foreclosures in the overall New York City market at the moment?

It’s an unfortunate trend. It’s there and we probably haven’t seen the worst of it yet. I have heard there is a two-year backlog, and there is a lot more in the pipeline. If you look at all of the boroughs, there are close to 11,000 listings of distressed sales of all sorts, including foreclosures and bank-owned REOs.

What are you seeing in Manhattan in terms of foreclosures, and how does that compare to last year at this time?

It’s still not much when you compare Manhattan to the other boroughs. There are 23 scheduled foreclosures [now] compared to December ’08, when there were 19. In Manhattan there are close to 600 distressed listings, meaning foreclosures, bank-owned REOs, whatever. For comparison, Brooklyn has over 3,000 and Queens has over 4,000.

Do you expect foreclosures to start spreading to Manhattan in greater numbers as unemployment continues to rise?

I think there will have to be a rise in foreclosures on the high-end apartments. I can’t see how they are going to be able to maintain themselves. We are talking about [recently] laid off people or people who were laid off a year ago and they still got some good bonuses or they still partied last year. But they are not going to make those figures again anytime soon.

Which neighborhoods are being hit hardest by foreclosures in New York, and what’s the outlook like for those places in the coming months?

Southern Queens is a disaster — Jamaica, Ozone Park, Kew Gardens, Cambria Heights, Queens Village — the whole area is in distress. In Brooklyn there is East New York, Brownsville, Bed Stuy and Ocean Hill. It’s not as bad as Queens, but in those areas it’s very hard to find a regular sale.

What’s the most surprising example you’ve seen of someone in foreclosure?

I did an appraisal at 20 Pine Street. The guy paid $1,000 per square foot. The reality is, somebody purchased it a year later as a short sale. You’d be surprised. People cover up a lot of things.

What effect has Obama’s mortgage modification program had on foreclosures and distress in New York?

It definitely helped — some of the people it helped permanently and some, it just bought them some time until they are in foreclosure again.

What kind of impact is the increase in distressed homeowners in New York having on property values here?

It depends how common it is in the neighborhood. If there are one or two, it doesn’t have such a negative effect, but when it is spread out and there are a lot of distressed sales, it brings down the value. Nobody would pay $100,000 more for a house when there are three similar homes on the block in distress that you can get for $100,000 less. It destroys the neighborhood — boarded-up or abandoned homes have a negative effect on the neighborhood as a whole.

How have foreclosures changed the world of brokering? Are a lot of brokers trying to get in on REOs and short sales?

I think that’s the hottest thing. It seems to be the trend now in the boroughs, at least in the neighborhoods that have been hit the hardest. Every broker is negotiating short sales today. Everybody suddenly became a professional on short sales.

Ingrid Gould Ellen

co-faculty director, NYU Furman Center for Real Estate and Urban Policy

What’s happening with residential foreclosures in the overall New York City market at the moment?

Foreclosures continue to rise in New York City. In the third quarter of 2009, there were nearly 6,000 foreclosure filings — the largest number since we began tracking quarterly foreclosure data in the early 1990s. That is up from about 5,500 filings in the second quarter of 2009, and there have already been more foreclosure filings in the first three quarters of 2009 than in all of 2008.

What are you seeing in terms of foreclosure now compared to three months ago, six months ago and a year ago in the city?

In the past year, we have seen an increase in the number of condos and five-plus-unit buildings going into foreclosure. In 2007, 345 buildings with more than five units received a foreclosure filing. In 2008, that number jumped to 454. And in the first three quarters of 2009, there have been 554 foreclosure filings on five-plus-unit buildings already. This is a worrisome trend, because it reflects an increasing number of renter households living in buildings entering foreclosure. However, while it needs to be watched, the overall numbers are still fairly small, and the vast majority of foreclosures are taking place on one- to four-family properties.

Do you expect a rise in foreclosures in New York City going forward?

I do not expect foreclosures to diminish anytime soon. We are beginning to see the nature of foreclosures change, with fewer rooted in subprime loans and more rooted in job loss and income declines. We are also likely to see a continued increase in multifamily foreclosures.

What about general distress, even outside of foreclosure? What are you seeing on that front in New York City?

Across the city, we are seeing troubling signs, such as stagnant incomes and increases in severe overcrowding, which tend to happen when families are trying to save money. The share of households that are severely crowded crept up to 3.6 percent in 2008, from a steady rate of about 2.4 percent for the past three years.

What effect has Obama’s mortgage modification program had on foreclosures and distress?

The program has begun trial modifications for more than 650,000 borrowers around the country. I think the program will help many borrowers stay in their homes. That said, there are many borrowers out there who aren’t being reached. Also, the program was very much designed to aid borrowers who had received unaffordable loans. Unfortunately, the foreclosure problem is now shifting, and more foreclosures are likely to result from job loss. It will not offer much assistance to borrowers who default on their mortgages due to job loss.

Bill Saniford

CEO, PropertyShark

What’s happening with residential foreclosures in the overall New York City market?

Manhattan has remained stable. There has been very little activity with foreclosures in Manhattan. The one that looks interesting to me is the Bronx. There has been a significant increase in the number of foreclosures in the Bronx — around 70 percent year over year. Brooklyn has remained steady. It is down about 5 percent year over year. Queens has actually improved: It’s down 20 percent, and the same with Staten Island. [But] when we are talking about foreclosures in general and not getting into percentages, we still see the worst borough being Queens; those numbers are far and away the largest in the city. They are larger than all of the other numbers combined.

What are you seeing in Manhattan in terms of foreclosures, and how does that compare to what you’ve seen over the course of the last year?

It is miniscule and not that significant. [But] in my opinion, Manhattan in general is at risk right now. There are significantly more lis pendens being filed in Manhattan than I have seen in a long time. That does not bode well for Manhattan. When people start going into lis pendens hopefully they will face reality and start dropping prices. If that happens I do believe that homebuyers will start coming in and scooping them up. These things tend to get worked out before the foreclosure process.

Which neighborhoods are being hit hardest by foreclosure in New York, and what’s the outlook for those places?

Obviously, Jamaica is the worst. The outlook for Jamaica is a disaster. I see lots of houses that are going to become vacant or in disrepair. Laurelton, Queens Village, same situation; Woodhaven, Kew Gardens [are both] bad as well. Howard Beach, Ozone Park, the Rockaways, Jackson Heights, East Elmhurst, those are all not doing very well. It’s a downward spiral. It’s a very bad situation when the property next to you goes into foreclosure — all of a sudden your property drops in value. I think everyone is at risk right now. I don’t see an area that is not at risk.

There’s a report from Deutsche Bank saying that 11 percent of mortgage borrowers in the New York area are currently underwater, but it predicts a rise to 77 percent by 2011. How worrisome is it?

It is incredibly worrisome. My numbers reflect the same thing. It’s very basic economics that as we have more distress we are going to have more downward pressure on [prices]. As we have more downward pressure we are going to have more homeowners going underwater, and as more homeowners go underwater that increases the likelihood that they will go into distress. There is something very psychological about paying on something where you owe more than it is worth. You have this feeling of, “I just want to walk away, I want to get out,” and people do. Again, it’s this downward spiral. I think there is at least another year of downward pressure.

What effect has Obama’s mortgage modification program had on foreclosures and distress?

I think it’s negligible, the reason being, any government involvement in the free market, if it does anything at all, is going to delay the inevitable, period. Actually, it could just prolong the agony.

What kind of impact is the increase in distressed homeowners in New York having on property values here?

A year ago I predicted prices would go down 25 percent. They went down 23 percent, I believe, roughly overall. I imagine that they are going to have to come down at least another 10 percent in the next year.

Rick Sharga

senior vice president, RealtyTrac

What’s happening with residential foreclosures in the overall New York City market at the moment?

New York City is seeing an increased level of foreclosure activity, but still isn’t suffering from the kinds of problems many other metropolitan areas are. Of the 200 largest metropolitan areas in the country, New York ranked 138th for third-quarter foreclosure activity.

What are you seeing in Manhattan in terms of foreclosures?

Manhattan has experienced the largest growth in foreclosure activity of any of the five boroughs — an increase of over 150 percent from the second quarter, and over 170 percent compared to last year. Part of this is due to buildings with multiple units being foreclosed on. Tempering all this is the fact that Manhattan still has one of the lowest rates of foreclosure activity in the state, and has the fewest foreclosure actions [by far] on a percentage basis of all the five boroughs.

Do you expect foreclosures to start spreading to Manhattan in greater numbers as unemployment continues to rise?

Manhattan certainly won’t be immune to unemployment-related foreclosures. Economists estimate that we can expect to see one new foreclosure action for every six to 10 jobs lost. What makes areas like Manhattan particularly vulnerable are the relatively high number of buildings with multiple dwelling units, and high home prices at a time when jumbo loans are hard to come by.

What can you tell us about foreclosures in New York City that doesn’t show up in the numbers?

In New York City and State, the numbers are probably understating the actual severity of the problem due to some legislative measures which delay the initiation of foreclosure proceedings against homeowners who are delinquent on their payments. The state also has the longest foreclosure cycle in the country, over 440 days, which means that some homes are in foreclosure over a year before going to sheriff’s sale or being repossessed by the banks.

What are you seeing in terms of buyers taking advantage of properties that are in foreclosure in New York?

Homebuyers and investors are finding great deals on foreclosure home purchases in today’s market. For example, the average sale [price] of a foreclosure home compared to a nondistressed home in Brooklyn is over $130,000. So for buyers who have cash or can get financing, this is a great time to be in the market.

Ken MacBride

senior vice president/director of REO marketing, Fillmore Real Estate

Can you give us an example of a particularly telling or significant foreclosure you’re seen or heard about?

Foreclosure is the end result of a vicious cycle. [I know] a once-proud homeowner of a fully detached frame home with a private drive and two-car garage on Bradford Street in East New York who became an innocent victim. He lost over 50 percent of his home’s value because the properties on both sides were abandoned. This was once a beautiful block. Now this street is filled with vacant, boarded-up homes that have been vandalized. The anticrime unit of the 75th precinct has been called time after time to fill out vandalism reports.

What can you tell us about foreclosures in New York City or in your area that doesn’t show up in the numbers?

Evictions. Innocent, unsuspecting tenants of foreclosed homes, who in some cases were placed inside only days before the actual foreclosure, [are being evicted]. Frequently, the homeowner feels he is on a sinking ship and wants to get all the rent money from the tenants without making a monthly mortgage payment. Unknowingly, a tenant moves into a vacant unit paying three times the monthly rent and security deposit, only to have someone like myself appear at their door to tell them the property has been foreclosed and we need to come to an agreement as to when they will move out.

What are you seeing in terms of buyers taking advantage of properties in foreclosure in New York? Are you seeing people swoop in and get them at discount prices?

In the ’90s, 99.9 percent of all foreclosed homes were sold to all-cash investors who had the ability to close the deal in 30 days or less. Fast forward to 2009, [and there’s an] inability to obtain financing, [so] the buyer pool has shrunk. However, the FHA 203k loan program has been a lifesaver for first-time homebuyers who want to purchase a foreclosed home. The program empowers the buyer to purchase distressed or foreclosed homes. It’s a wonderful program that’s underutilized.

Michael Diaz

owner, Village Realty in Staten Island

What’s happening with residential foreclosures on Staten Island?

The North Shore of Staten Island has them. There don’t seem to be too many on the South Shore right now.

What are you seeing in terms of homes going into foreclosure now compared to three months ago, six months ago and a year ago in the city?

They were heavier six months ago and a year ago, but it takes time for them to hit. I think it is slowing down.

What about general distress, even outside of foreclosure? What are you seeing on that front on Staten Island?

A lot of people are upside down on their loans. Anybody who bought in ’05 and ’06 can’t get what they paid for it, so they are okay as long as they don’t lose their job and they can afford what they bargained for when they took out the loan. Unemployment is a big problem.

What is the most surprising example you’ve seen of someone in foreclosure?

A doctor who opened a bunch of clinics that he cosigned with his home. The business expanded into every borough with clinics and he overextended himself. It hasn’t gone into foreclosure yet, but he was running late.

Jeff Silverbush

president, Century 21 Best in Queens

What’s happening with residential foreclosures in the overall New York City market at the moment?

There are plenty of them. It’s obviously a trend that is going to continue over at least the next two to four years.

What is the most surprising example you’ve seen of someone in foreclosure?

We’ve seen some very prominent properties that we were sort of surprised to see, that were tremendously in arrears. Thinking of the neighborhood I live in, one of the Baldwin brothers had a house in foreclosure. You see a lot of prominent people whom you thought of as wealthy, well connected and financially secure. I’m not dealing with most of these people. Most of my business is regular middle-class people.

Are you seeing people swoop in to get properties at discount prices?

No. There is not huge enthusiasm for them. The banks that take them in are not pricing ridiculously low. They are putting them out at pretty fair prices. Homeowners who would want to buy [are finding] that the bank is sometimes very slow in responding. And the bank doesn’t like to lose money.

Developer Clipper Equity covered closing costs for purchasers who signed contracts in the 27-story, 250-unit building last month. Ilan Bracha, a broker with Prudential Douglas Elliman, the exclusive marketing and sales firm, said that removing the closing costs enhanced the listings’ values. The closing costs for BellTel residences under $1 million are around 5 percent of the overall purchase price, according to a statement from the developer. [more]

At peak, 51 percent of the buyers at the 505 at 505 West 47th Street had cases in federal court to rescind their contracts.

At peak, buyers of 55 out of 108 units (51 percent) at the 505 at 505 West 47th Street had cases in federal court to rescind their contracts, which were worth a combined $43.1 million. Six have since dropped their cases, and three have closed on their units (one received a 3.5 percent discount). The plaintiffs claimed Parkview, headed by Ian Reisner and Mati Weiderpass, failed to provide the property report required under the Interstate Land Sales Full Disclosure Act. After Parkview realized its mistake, the buyers claim it filed an amendment to the offering plan in an attempt to exempt itself from the law by removing eight units and combining another two, so the initial offering plan would only be comprised of 99 units. [more]

Renderings of the utility structure planned for outside the 96th Street station of the under-construction Second Avenue subway

Those sticky summers languishing on the platform will be obsolete for future riders of the Second Avenue subway. Unlike most city subway stations, where air is sucked through sidewalk grates by passing trains, the new stations will be chilled by a modern ventilation system. But much to the dismay of some Upper East Siders, that ventilation system will be housed in permanent aboveground utility structures situated at each end of the stations, many as large as midsize apartment buildings, rising up to nine stories tall. As part of its first phase of Second Avenue subway construction, the Metropolitan Transportation Authority is planning eight of these structures along a 34-block stretch of the Upper East Side. [more]

David Picket, president of the Gotham Organization, inside 200 West, his firm’s new rental on West 72nd Street.

West 72nd Street and Broadway epitomizes old New York. Brick-and-terra-cotta icons like the famed Dorilton mix with the bright lights of Gray’s Papaya. But there’s a newcomer that looks more like South Beach, splashing glass amid the stately stone.
Named 200 West for its 72nd Street address, the 19-story rental tower broke ground in 2007, near the height of the boom, and is scheduled to start leasing in February. In addition to the 196 apartments, the building, which wraps an obtuse-angled corner, also has a total of 50,000 square feet of big-box-style, multilevel space for three retailers. That’s in a neighborhood where stores typically measure a fraction of the size. “We will certainly liven up that corner a lot,” said David Picket, president of the Gotham Organization, the developer of the $220 million project and one of its three investors. The others are Philips International Holding and Rhodes NY. [more]

A Boston developer has hit a few snags in its plan to build a giant residential tower. Goldman Properties wants to construct a 25-story, 232-unit apartment building and parking garage in the Fort Point Channel neighborhood that, if built, would be the tallest structure in the neighborhood. Goldman will have to make concessions in order to gain construction approval for the 315,000-square-foot development from the Boston Redevelopment Authority, the Boston Globe reported. The developer’s options include building 30 affordable housing units or donating another property for local artists displaced by the project. To sweeten the deal, Goldman has offered to pony up $900,000 to help build more parks in the neighborhood. [more]

Dottie Herman

Dottie Herman is the president and CEO of Prudential Douglas Elliman, which has more than 60 offices in New York City, Long Island and the Hamptons. Herman, who began her career as a real estate broker on Long Island, purchased Prudential Long Island Realty in 1989. After expanding the company to the Hamptons, she purchased longtime Manhattan brokerage Douglas Elliman for nearly $72 million with her business partner, Howard Lorber, in 2003. The company continues to grow, recently opening new offices in the West Village and in Fort Greene, Brooklyn. [more]

Burt Stavitsky of Brown Harris Stevens

Who wouldn’t want to live in Sutton Place? The prewar-laden enclave stretches from the south side of East 52nd Street to the north side of East 59th Street, and from Second Avenue to the river. It’s a part of Manhattan that feels wholly unlike Manhattan. There are tree-lined streets and blocks landscaped with tulips — all next to the East River. “It’s secluded; you can’t go any further east,” said Brown Harris Stevens’ Gerald Crown, who has worked in Sutton Place for nearly 20 years. “I think that’s what keeps it special.” Sounds pretty nice, right? Except that sales in the area are down compared with the rest of the borough. According to data culled by StreetEasy, 18 deals closed in September 2009, the most recent month for which data was available, compared to 28 in the same month last year. That’s a drop of almost 36 percent. Yes, the whole borough has seen sales lag. But Manhattan-wide closings were down 25 percent over the same period, according to StreetEasy. [more]

After months of acrimonious negotiations, the Bloomberg administration
agreed to pay developer Joseph Sitt $95.7 million for seven acres of
land on Coney Island. Sitt, CEO of Thor Equities, had been locked in a
stalemate with city officials over how to best develop the stretch of
land. Since he began buying up land there in 2005, many of Sitt’s
development plans, including a $1.5 billion Las Vegas-style resort,
have yet to be built. Sitt will scale back his mega-project to adjacent
parcels that weren’t sold to the city and which he still owns. “We have
to redo all of our plans, but we will still have millions of square
feet of apartments and hotels and retail and restaurants and enclosed
amusements,” Sitt said in a Q & A with The Real Deal last month. “The latter versions of the renderings are close to what it will be.”
[more]

Take a close, hard look at the new $6,500 federal tax credit for
so-called move-up homebuyers that passed the Senate and House last
month. Though it’s been getting second billing to the original $8,000
credit for first-time purchasers — now extended by Congress through
next June 30 — the $6,500 credit for current homeowners just might
have your name on it.
How does it work? When will it be available?
First things first: The new credit is available now. It took effect
the day President Obama signed the legislation creating it — Nov. 6.
This means that if you fit the key criteria — you’ve owned and resided
in your current home for a consecutive five out of the past eight
years, and your adjusted household income doesn’t exceed $125,000 if
you file taxes singly, $225,000 if you are married filing jointly –
you can claim the credit as soon as you close on a qualifying house.
[more]

Go ahead. Break the chains. Stop paying your mortgage if you owe more
than the house is worth. And most important: Don’t feel guilty about
it. Don’t think you’re doing something morally wrong.
That’s the incendiary core message of a new academic paper by Brent
T. White, a University of Arizona law school professor, titled
“Underwater and Not Walking Away: Shame, Fear and the Social Management
of the Housing Crisis.”
White argues that far more of the estimated 15 million American
homeowners who are underwater on their mortgages should stiff their
lenders and take a hike.
Doing so, he suggests, could save some of them hundreds of
thousands of dollars that they “have no reasonable prospect of
recouping” in the years ahead. Plus, the penalties are nowhere near as
painful or long-lasting as they might assume.
[more]

It is hard for this pessimist to report that it looks like the stars in
the galaxy seem aligned for better times ahead in the New York City
office market.
You don’t have to take my word for it — a number of leading
experts on the city’s office market are lining up to testify to the
market’s improving health. After more than two years of being one of the most bearish real
estate leaders, Barry Gosin, CEO at Newmark Knight Frank, told the
November meeting of the Association of Real Estate Women that “the
office market has rebounded in New York City.”
Even Gosin’s partner Jim Kuhn, Newmark’s president, who has been
quite negative, was singing a different tune in October at the New York
Real Estate Summit. “The office market is getting better in New York.
Strong landlords and quality tenants will gain traction in the market,”
he said.
[more]

When the economy sours, one of the few sectors to profit is usually
postgraduate education. Laid-off employees, or simply scared ones,
historically have flocked to school to beef up their résumés in the
hopes of better positioning themselves in the job market. But for some real estate professionals, this recession is different.
At New York University’s Schack Institute of Real Estate Continuing
Education Program, which offers over 500 classes each year, enrollment
dropped 10 to 15 percent between fall 2008 and fall 2009. The Real Estate Board of New York has also seen a 5 to 8 percent
decline in their for-credit continuing education program participants,
who typically register in order to maintain their licenses.
Back to school? Not this recession.” class=”read-more-link”>[more]

For once in New York, the controversy surrounding Columbia University’s $200 million interdisciplinary science building at 120th Street and Broadway — and there has been a good deal of controversy — does not have to do with the quality of the building, but with its location and structural stability. Now topped out and mostly clad, it is clearly a distinguished edifice, especially by the debased standards of the Big Apple. Only here would one consider how nice it is that a renowned architect, Rafael Moneo, was able to build without having to alter his vision in some fundamental and degrading way! When the building is fully operational, which should be next fall, it will rise 14 stories and contain 50,000 square feet of laboratories, as well as a 170-seat lecture hall; a library for students of physics, chemistry, psychology and biology; and a café, visible at street level, that will be open to the general public. One of several problems Moneo confronted planning this structure was a preexisting gymnasium that occupies the same footprint as the new building. Not only was the architect required to preserve the gym, it had to remain fully operational while the science building was being constructed above it. As a result, it was impossible for structural supports to rise directly over the midsection, which contains the gym. [more]

Real estate markets in Asia are rebounding so quickly from the global downturn that several governments have signaled that they may step in to cool rising prices. Meanwhile, Milan bankruptcy court last month approved the 500 million euro debt restructuring plan of Italian real estate development group Risanamento SpA, arguably one of the worst victims of the Italian real estate collapse, and Australian residential brokers reported that foreign investors were making up an increasingly large chunk of their clientele. [more]

After a catastrophic slide in which building prices fell by more than 40 percent, London’s commercial real estate market seems to have hit its bottom. While New York commercial property is still searching for a floor and is expected to continue falling, in its rival and sister city across the Atlantic, things are looking up. Sale prices have started inching upward, prime-area rents are stabilizing, and new leases are increasing — albeit from a very low base and with vacancy rates still rising. It’s hardly a return to boom times, but market analysts say the third quarter of 2009 was the best since the financial crisis hit last fall. “We very much believe the bottom has been reached,” said James Young, head of Cushman & Wakefield’s office in London’s financial district. “We’re a lot more optimistic than perhaps some other markets around the world.” Eighteen months ago, Young said, many thought London would lose the prominence it shares with New York as a global financial center. Now, with the health of the banking sector improving, “that fear seems to have dissipated,” he said. [more]

Richard Dansereau, the nine-year president and COO of the real estate division at Canada’s leading pension fund manager, has signed on to serve as managing director of New York City-based Stonehenge Partners’ investment management division. Dansereau will work with Stonehenge’s institutional and private investors, according to a statement from Stonehenge, which owns more than $1.5 billion in properties, mostly residential buildings in Manhattan. Dansereau began his career as a broker, and Stonehenge co-owners Ofer Yardeni and Joel Seiden said that his background makes him uniquely suited for the firm. “Richard’s appointment underscores our firm’s commitment to developing strong relationships with our investment partners,” Yardeni and Seiden said. Prior to accepting the Stonehenge job, Dansereau managed a real estate portfolio worth $9.5 billion as chief operating officer of Cadim, a real estate division of Caisse de dépôt et placement du Québec. [more]

If real estate brokers occasionally suffer from a bad rap, attorneys are surely afflicted with the same problem. But according to Joseph Ferrara, an attorney specializing in real estate and intellectual property for 28 years, those two professions can make a winning combination. That’s the idea behind Ferrarra’s New York Real Estate Advocates, a new residential brokerage group — with a tentative early 2010 launch date — that will be run by real estate attorneys, with licensed agents making the sales. “We’re trying to model it after a law office somewhat [and] we’re coming to the table with legal knowledge that other brokers don’t have,” Ferrara said. “Because we know real estate law, we know how to save [clients money] on transfer taxes, et cetera.” Ferrara said he plans to upend other standard practices of the industry as well. Principals won’t be called “brokers,” but instead, “advocates.” The agency will run on a subscription-based model, meaning that agents will pay a monthly $100 fee to the firm and keep 100 percent of their commissions. There will be no quotas. He also hopes that the agency may even do some pro bono work. [more]

Residential

Argo Residential

Janet Moore joined the firm, focusing on both rentals and sales in Manhattan and Queens.


Barak Realty

Juliana Longoria and Chris Randolph joined the firm as sales associates.


Fox Residential Group
Rob Taub joined as vice president. He was previously a vice president at Prudential Douglas Elliman.


Sierra Realty Corp.
Stephen Carter joined as senior vice president of residential property management. He was previously vice president and director of property management at Manhattan North Management.


TDG/The Real Estate Group NY

Fabrizio Uberti Bona was hired as managing director. He was previously with the Marketing Directors.


Urban Marketing

Meagan Roberts joined the firm as operations manager. She was formerly operations manager at JC DeNiro & Associates.


Weichert Realtors, Mazzeo Agency
Jeremy Basloe, Belinda Bennett and Barbara Smolarcyzk joined the company’s sales team.

Commercial

The Clarett Group

Ruth Ann Blankenheim was promoted to vice president.


Cresa Partners

Richard Charkham was appointed senior vice president in the company’s New York office.


Jones Lang LaSalle

Ann Sperling was appointed chief operating officer for the company’s Americas region. Louis Buffalino was hired as senior vice president in the New York office. He was formerly a first vice president with CB Richard Ellis.

The Kaufman Organization
Slater Traaen was hired as an associate broker. He was previously an associate at Conquest Advisors.


Massey Knakal Realty Services
Valentin Presnov was hired as a senior associate in the company’s Brooklyn office.


Newmark Knight Frank

Barry Berkowitz joined the firm’s capital group as a managing director. He was previously a principal of Beta 2 Fund, a New York-based buy-side fund.


Tishman Construction
Charles Appet was promoted to director of preconstruction. He was previously director of purchasing and estimating.


UGL Equis

John Pavone joined as vice president. He was previously a vice president at CB Richard Ellis.


Winoker Realty

Jerry Suchman and Barbara Eddington joined the firm as managing directors. Adam Reisman joined as an associate.

Compiled by Victoria DeCarmine

In what may be an attempt to live up to its name, luxury condo developer Alchemy Properties plans to invest in the development and rehabilitation of distressed properties. With a new initiative in place to invest in the properties, Alchemy will target partially finished developments and overleveraged rental-to-condo conversions. Although the down market has spawned a number of distressed asset investment programs, Joel Breitkopf, a partner at Alchemy, said he’s confident that his firm’s initiative — it’s not a formal distressed asset fund — will stay ahead of the pack. He says that an understanding of the numbers behind residential development gives them an edge over other investors. “When a developer is under pressure, they tend to cut corners and their subcontractors tend to cut corners,” Breitkopf said. He said that his firm’s hands-on experience evaluating potential developments will help it avoid dangerous, poorly constructed investments. [more]

Times are tough, but don’t skimp on the tip. That’s the message from
Judi Desiderio, CEO of Town & Country Real Estate on the East End
of Long Island, to her brokers.
“We will still be sending gift bags to all our ancillary service
providers,” she said. That means people who open lobby doors and
deliver the mail.
But tips from New York brokers were certainly more plentiful during the boom.
“Tips for the 2009 holiday season will be in modified form,” said
Halstead Property broker Jill Sloane. “However, the doormen and
superintendents really appreciate gifts, so it’s important to keep up
with tips even though you may have made less money this year,” she
added. [more]

Mark Madoff’s Nantucket home at 51 Wanoma Way may not be on the market, but a sale is possible.

The beach house in Montauk found a buyer quickly, and for more than its
list price. Now, as the investigation into the fraud run by Bernard
Madoff expands to include his family members, some are wondering what
will become of son Mark Madoff’s getaway on Nantucket.
The five-bedroom waterfront home at 51 Wanoma Way is not on the
market, Nantucket brokers say, though a sale is entirely possible.
“I wouldn’t be surprised if it were listed,” said Gary Winn, a
principal with Maury People Sotheby’s International Realty, who has no
connection to the Madoffs.
Mark bought the house for $6.5 million in 2008, just months before Bernie’s $65 billion Ponzi scheme was exposed.
[more]

A Wafels & Dinges food truck

Many equate New York food trucks with hot dog carts or greasy spoons.
But a glut of new retail food trucks, from Schnitzel and Things (which
can be spotted in Midtown during the weekday lunch rush) to dessert
purveyor Street Sweets, have added to longtime stalwarts like the
bright orange Mud Truck (which started in the East Village and has
served up brew since March 2001). And in this economy, many say real
estate on wheels is an appealing alternative to more expensive
brick-and-mortar retail spaces, especially for new businesses.
Food truck operators say there are several benefits to their
business model, including reduced costs, the ability to test out the
market, and the flexibility of being able to try different locations. [more]

Twenty months after a deadly crane collapse halted construction on a tower at 303 East 51st Street, new life has come to the condominium. HFZ Capital Group acquired the note on the building from Arbor Realty Trust for $40 million, after the original principal developer, James Kennelly, invested more than $110 million in the defaulted project, according to sources.
Nineteen of the building’s 30 floors have already been built, and the rest should be completed within a year and a half, according to a source closely involved in the deal. The project, east of Second Avenue, has yet to be named, but HFZ is expected to invest $60 million to complete construction. HFZ is a partnership between developer Tamir Sapir; Ziel Feldman, chairman of Polar Investments; and Israel-based Acro Real Estate, although Sapir had nothing directly to do with the crane note purchase, sources said. [more]

A Japanese industrial firm paid $501 per square foot for a Midtown skyscraper known as Tower 49, a price that at the time was the highest ever paid for a Manhattan office building, 22 years ago this month.

The company, Kato Kagaku, purchased the 45-story midblock high-rise at 12 East 49th Street, between Fifth and Madison avenues, from the building’s developers for $301 million. The 600,000-square-foot skyscraper was built by David Solomon, G. Ware Travelstead and First Boston on an irregular parcel extending from 48th to 49th Street and opened in 1984. Kato Kagaku, a manufacturer of corn-based products, still owns the building today. The tower is home to a variety of companies, including the corporate offices of retailer Saks Fifth Avenue, financial firm Steinberg Asset Management and the sales office for metal recycling firm Schnitzer Steel Industries.
The previous highest price for a major Manhattan office building was the Japanese real estate company Shuwa’s purchase in June 1986 of the American Broadcasting Corporation building at 1330 Sixth Avenue for $175 million, about $365 per square foot. [more]

Until last year, The Real Deal‘s annual accounting of real
estate records was a Mad Libs of giddy peaks: The highest price ever
paid for [insert type of real estate] in [insert name of borough] was
catalogued, time and again.
Even in 2008 — before Lehman Brothers fell and the recession
tightened its stranglehold on the city — records were toppled. On the
residential side, Manhattan logged the highest median sale price ever,
$945,276, while on the commercial side, Boston Properties paid $2.9
billion for the GM Building, the highest price ever shelled out in the
United States for an office tower. But many of 2009′s records are record lows, rather than record
highs. For example, the second quarter of the year saw the largest
year-over-year drop — 25.6 percent — ever recorded by appraisal firm
Miller Samuel in Manhattan’s median sale price for apartments. The firm
has been releasing market reports for the last decade.
[more]

This is a year that many in New York City real estate would like to
forget ever happened. It began with business as we knew it seeming to
cease entirely, with the deals disappearing and the fat checks for
brokers along with them. A year when one had to figure out how much was
saved up from the good times, and how long it would last (even if
things improved later in the year).
We’ve looked at New York City’s bottom-scraping records and
lowlights in a package starting on page 44, but some context is
helpful, if only to make us feel better: While New York tanked, some
other markets experienced catastrophe.
[more]